CHA News Article

CDPH Updates Guidance to Reflect New State Law for Observation Services
CHA to host webinar explaining state, federal notification laws

CDPH has updated its previous All Facilities Letter (AFL) clarifying the process by which hospitals may apply for an observation services unit, and addressing notification of patients receiving observation services. SB 1076 (Chapter 723, Statutes of 2016), which took effect Jan. 1, requires hospitals to provide a written notice to a patient on observation status who is cared for in a hospital’s inpatient unit or in an observation unit, or following a change in a patient’s status from inpatient to observation.

The law requires the notice to state that while on observation status, the patient’s care is being provided on an outpatient basis, which may affect his or her health care coverage reimbursement. In addition to the notification requirement, SB 1076 allows for the designation and use of observation units for the first time. Many hospitals have developed clinical decision units or emergency department-adjacent units to care for patients on observation status; this was not specifically permitted by state law until now.

To assist providers in complying with this law, as well as new federal requirements, CHA will host a webinar on Feb. 14 from 10 a.m. – noon (PT). The webinar will detail SB 1076’s requirements along with the Centers for Medicare & Medicaid Services’ new Medicare Outpatient Observation Notice, which will be required beginning March 8.